FBR asks sales taxpayers to submit trade details

KARACHI: Tax authorities have asked registered sales tax persons to submit details of their trade by August 10 in order to get an adjustment in their liabilities, an official said on Tuesday.

The deadline is set to claim input adjustment for the month of July 2016.

A senior official at the Federal Board of Revenue (FBR) said input adjustment would only be available against those supplies which were verified by the online system. “The system has been launched to stop sales tax frauds and eliminate bogus companies,” said Muhammad Irshad, Member, Inland Revenue (Operations).

The sales tax registered persons are required to submit details of sales of a month on 10th day of subsequent month or around five days before filing of monthly sales tax statement. “The FBR has made it clear to person that no claims for input adjustment or refund would be entertained on such claims where the authorities had not received payments,” Irshad said.

The Member said the department had detected misuse in sales tax refunds and input adjustments through fake and flying invoices in the past.  “Thousands of bogus companies were established to obtain refunds, however those were blacklisted on identification.”

Sources at the Regional Tax Office (RTO) Karachi payments and adjustments of around Rs40 billion through fake claims were deducted in the year 2010 and 2011. “Tax department failed to take any action in those cases because of its inefficiency,’ sources added.

Taxpayers previous expressed their reservations on the deadline as in a number of occasion their buyers failed to deposit payment details for the month. And in such cases genuine taxpayers fail to get adjustments.

Irshad said Under Sales Tax Real-Time Invoice System (STRIVe) a taxpayer could declare its trade details in the next three months in case buyers delay payments.